Pog appeal: advance notice

This Thursday, 12 May, Advocate General Mengozzi will be giving his Opinion in Case C-281/10 P PepsiCo v Grupo Promer Mon Graphic (click here for the Board of Appeal's decision to reinstate PespiCo's design registration, here for details of the General Court's decision to re-revoke it and here for the grounds of appeal).

For the record, the Advocate General's Opinions are upheld in around 75 to 80% of cases by the final ruling of the Court of Justice of the European Union.  That Court is not, however, bound by its own decisions and may reverse them when invited subsequently to rule again on the same issue.

End of the road for Evets

Old musos will remember Danelectro's classic guitars - the mark has been in use for over 60 years now. But the ECJ (Decision C-479/09 P), supporting OHIM's hard-line policy on restitutio in integrum, has recently cancelled this old and valuable mark for failure to pay the renewal fee, on grounds that appear to put applicants in a very precarious position - on the basis of a legalistic interpretation approach that, we have argued in the past, is focussed on OHIM themselves and opposed to commercial reality and the needs of the marketplace.
In the Danelectro cases, the applicant adopted the practice (near-universal in large companies) of handling renewals through an agency. OHIM's correspondence, however, went to the appointed representative. The issue was, when was the "cause of non-compliance" removed? Was it when the representative heard from OHIM, or when the client (or the renewal agency) were told? The Court's mechanistic approach was simply to quote the rules which put the representative in the shoes of the client for OHIM's purposes. Thus, the relevant two-month time limit started to run when the representative got the letter from OHIM, even though the representative was completely out of the renewal loop and had no authority from the client to act on renewals. The same logic would apply even where, in reality, the representative had no further authority to act, if OHIM had not yet been notified of that fact.
When applying a highly penal provision, can it really be right to ignore the reality behind the rule, which is that, where it is the applicant who failed to comply with a deadline, the removal of non-compliance must also be referred to the applicant? Should a 60-year old mark be lost, in a first-to-file system, where the applicant is not at fault? The answer seems self-evident to us.
Our concern on Class 99 is that, since the Community Design provisions are identical to those for CTMs, and the reasoning of the Court is so mechanistic, they will apply the same approach to design renewals. The results would be disastrous. A trade mark can be re-filed, and unless someone else has acquired intervening rights, will be re-registered. But any design, by renewal time, will have been published by OHIM so that a re-filing would lack novelty and the design would be irrevocably lost.
Is it too much to hope that the Court might issue a divergent opinion for designs? Well, it remains at least a theoretical possibility. One of the suggestions raised by the appellant was that EPO case law under the identically-worded EPC provisions should be followed. OHIM and the Court, at all instances, refused to do so. One of the reasons given by the Court of First Instance (now the General Court), in their decision T 20/08, was that:
...even if Article 78 of Regulation No 40/94 was drafted on the basis of a patent law model, there is nothing to suggest that the respective provisions must be interpreted identically, since the interests at issue in the two areas may differ. The legal context of patent law is different, and the provisions governing patents seek to regulate procedures different from those applicable in the area of trade marks (Case T‑136/08 Aurelia Finance v OHIM (AURELIA) [2009] ECR II‑0000, paragraph 21)."
Well, following that reasoning, designs are different to trade marks - in fact, as to the novelty issue, they are much more like patents. So ... is anyone prepared to try to tell the Court to apply their own words to designs, and follow the EPO's more applicant-friendly approach where the consequences of failure are so much more penal than for trade marks?
In the meantime, what about resuming the filing of authorisations at OHIM - specifically limited to exclude renewal business? We might try that ourselves, if no one else can be found to do so.
Please do keep us informed of any restitutio cases in the pipeline, as we have had widespread expressions of concern from applicants since our last item on this topic.

Pingpong pogs at the ECJ

Regular readers will recall the longrunning battle between Pepsico and Grupo Mon Promer over the former's RCD for pogs/rappers/Tazos.  At first instance, the design was revoked; the OHIM Appeal Board reversed; then the General Court re-reversed.  We are pleased to see that the case has now moved up to the ECJ.  After this, no further appeals are possible (although national judges will no doubt feel free to make remarks about how much they'd like to reverse it, or change the law, if they could).
The ECJ case is pending as C-281/10P.  A link to the reference is here.
The grounds are that the General Court violated Council Regulation (EC) No. 6/2002 by:

a)    failing to take into account the constraints on the designer in developing the contested design;

b)    wrongly interpreting the notion of the "informed user" and his attention level;

c)    applying erroneous criteria in its assessment of "different overall impression";

d)    carrying out a comparison between the designs based on actual products in the file rather than on the designs as registered; and

e)    basing the comparison on distorted facts.

As to point (e), we wish them all the best with that since appeals can only be on points of law and this is blatantly a scarcely-disguised point of fact. As to point (d), well, we see the issue, but the UK courts have long held themselves able to look at specimens alongside the design, otherwise it is difficult to compare like with like (the Australian court has disagreed in LED Technologies v Elecspess which, we note, has just been upheld on appeal though not on that point).

Points (a) to (c) should, however, give the ECJ a chance to air its views on the validity threshold and thus, indirectly, scope of designs since the two tests are largely the same.  We'll keep watching this space so you don't have to.

Pepsico fail the Court's taste test in first design appeal

The European General Court (formerly the Court of First Instance or CFI) today ruled on the "Metal Rappers" case, T-9/07, Grupo Promer Mon Graphic SA v OHIM, PepsiCo Inc., intervening. This concerned RCD 74463-0001 filed by Pepsico, based on a Spanish priority application.   Having been revoked at first instance, Pepsico won their appeal at OHIM. However, Grupo Promer Mon Graphic's appeal to the General Court has just been allowed, overturning the Pepsico registration once more. It remains to be seen whether Pepsico will take this to the top with an appeal to the European Court of Justice (ECJ).

The main reason for reversal within OHIM was a narowing redefinition of the class of article considered from "promotional items" (the indication of product for which the design was registered) to "metal rappers" (aka "tazos" or "pogs") in particular, with the consequence that the "design freedom" available was held to be narrow rather than broad and the threshold required to differ from the state of the art was therefore lower. The ECJ upheld the Board of Appeal on this point (as it did on most of the legal issues in play in the appeal), but nonetheless found the design similar enough to the prior art to lack individual character.

Some specific points of interest:

1. Grupo Promer Mon Graphic tried to introduce new documents in the appeal to the General Court - apparently in reply to the OHIM appeal decision below. These were "excluded, without it being necessary to assess their probative value (see, to that effect and by analogy, Case T-346/04 Sadas v OHIM – LTJ Diffusion (ARTHUR ET FELICIE) [2005] ECR II-4891, paragraph 19 and the case-law cited)." (Decision para 24).

2. Grupo Promer Mon Graphic argued some bosh based on "bad faith" (which always tends to sound a little desparate to these Anglo-Saxon ears), in that there was an alleged confidential disclosure to Pepsico before they filed. According to the General Court, the grounds listed in Article 25(1) of Regulation No 6/2002 "must be regarded as exhaustive, since Article 25 provides that a Community design may be declared invalid only on one of the grounds specified therein." (Decision para 30).
Perhaps the same fact-pattern could have formed the basis for a copyright infringement (Article 25(1)(f)) or entitlement (Article 25(1)(c)) challenge - the latter, however, could not have been brought at OHIM until after a national Court decision.

3. The Court considered one of the many bizarre language discrepancies which plague the Regulation (and the corresponding Directive 98/71); "in the vast majority of the language versions, the wording of Article 10(1) of Regulation No 6/2002, like that of Article 9(1) of Directive 98/71, indicates that the issue is one of a ‘different overall impression’. Two language versions (namely the French and Romanian language versions) in the case of Article 10 of Regulation No 6/2002, and one language version (namely the French language version) in the case of Article 9 of Directive 98/71, state that the issue is one of a ‘different overall visual impression’." They considered that there was no difference of substance as the "overall impression" must be a visual one (Decision para 50).
That appears to lay to rest an interesting discussion, going back to the earliest preparatory documents, as to whether the sense of touch can play a part in assessing overall impression, given that features such as "material" and "texture" form part of the definition of a design.

4. "Conflict" with an earlier-filed unpublished design as a ground of invalidity (Article 25(1)(d)) arises when the later falls within the scope of protection of the earlier by creating the same overall impression, as OHIM have consistently held since their 2004 Eredu v Arrmet invalidity decision.

5. Although the indication of product given in connection with a RCD does not affect the scope of protection, it can be used to determine the product used in various parts of the "overall impression" test, such as the "design freedom" subtest. However, where there is a particular category of products within a broad category defined by the "indication of product", this also can be used, as the Board did in this case (Decision paras 59-60). Applicants will therefore need to give a little thought to indications of products in future, as we have thought possible since OHIM Appeal Decision R 1421/2006-3, the Cash Register case.

6. As to the "informed user", the General Court held that "the informed user is neither a manufacturer nor a seller of the products in which the designs at issue are intended to be incorporated or to which they are intended to be applied. The informed user is particularly observant and has some awareness of the state of the prior art, that is to say the previous designs relating to the product in question that had been disclosed on the date of filing of the contested design, or, as the case may be, on the date of priority claimed." (Decision para 62). That much is certainly in accordance both with OHIM and UK case law, and the phrase "particularly observant" could be read as supporting Lord Justice Jacob's view in Procter & Gamble v Reckitt Benckiser that the person concerned is more acute than her trade mark counterpart.

7. In this case, the "promotional product" was an intermediate product which was for advertising other things. Thus, the "informed user" could be either a child of 5-10 (the end user) or a marketing manager of some other product (an intermediate trade user), as the Board of Appeal had said, although it made no difference in this case (Decision para 64). I do not read the decision as indicating that the "informed user" is in trade in the goods themselves (i.e. the metal rappers).

8. In relation to "Design Freedom", the crux of the case, the Court referred (Decision paras 67-70) to the following factors as limiting design freedom:

• features imposed by the technical function of the product;
• statutory requirements applicable to the product;
• cost (these items had to be inexpensive);
• safety for children;
• fitness to be added to the products which they promote.

9. The effect of limited design freedom is to increase the odds that small differences will produce a different overall impression (Decision para 72).

10. In relation to the comparison itself, the Court gave a number of pointers:

• Similarities in features common to a class of product (here: the metal rappers) will have only minor importance in the overall impression (Decision paras 72, 76 &; 77);
• Similarities in features imposed by constraints on design freedom will not attract the informed user's attention (Decision paras 72 & 78).
• Similarities in the most visible portions (here: the upper surface) will attract the informed user's attention (Decision para 82).

UK readers will be watching for similarities and differences from the approach of the UK Courts. Two strike me. Firstly, the reference in para 77 to imperfect recollection: the Court says that a similarity in a common feature "would not be remembered by the informed user in the overall impression of the designs at issue".
Secondly, the Court's analysis does not start by defining in vacuo an overall impression produced (a) by the design and (b) by the prior design, and then comparing the two: instead, the Court proceeds to look at paired features of the two as similarities and rule on each in turn, giving each an appropriate weight. I suppose this might arise from the function of conducting a review of the decision below, but it is a different algorithm, which might lead to different results.

What do you all think? Should Pepsico appeal? Comments welcome!

 

ECJ's FEIA decision on commissioned designs

The ECJ has decided the FEIA case C-32/08, and remarkably quickly by their own lights. The case concerned ownership of commissioned designs.
The designs in question (of cuckoo clocks) were part of a project started by FEIA (Fundación Española para la Innovación de la Artesanía, or Spanish Foundation for the Innovation of Craftsmanship) and organised by AC&G SA, who then made an oral contract with Cul de Sac Espacio Creativo SL, the employers of the designs in question. FEIA claimed ownership in the Spanish courts. Spanish law, like that of the UK, vests rights in the commissioner rather than the designer. They won at first instance but on appeal the Court referred the issue to the ECJ.
We reported the AG's Opinion here, back in April. As usual, the Court agrees with the broad thrust of the Opinion.

The headline issue couldn't be clearer:
"the arguments of the FEIA and the United Kingdom Government that the terms ‘employer’ and ‘employee’, in particular, in Article 14(3) must be interpreted broadly in order to apply also to commissioned designs, must be rejected."

These are questions of Community, not national, law:
"Thus, it follows from the need for uniform application of Community law and from the principle of equality that the terms of a provision of Community law which makes no express reference to the law of the Member States for the purpose of determining its meaning and scope must normally be given an autonomous and uniform interpretation throughout the Community, having regard to the context of the provision and the objective pursued by the legislation in question (see, inter alia, Case 327/82 Ekro [1984] ECR 107, paragraph 11; Case C‑287/98 Linster [2000] ECR I-6917, paragraph 43; and Case C‑316/05 Nokia [2006] ECR I-12083, paragraph 21). That is the case for the terms ‘designer’ and ‘successor in title’ in Article 14 of the regulation."

In paras 79 to 82 they deal with the effects of assignments:
"79 It follows from the above that the possibility of assigning by way of contract the right to the Community design from the designer to his successor in title within the meaning of Article 14(1) of the regulation is consistent with both the wording of that article and the aims of the regulation.
80 It is, however, for the national court to ascertain the contents of such a contract and in that regard to determine whether the right to the unregistered Community design has in fact been transferred from the designer to his successor in title.
81 The above considerations clearly do not preclude the national court, in the context of that assessment, from applying the law on contracts in order to determine who owns the right to the unregistered Community design, in accordance with Article 14(1) of the regulation.
82 In the light of all the above considerations, in circumstances such as those of the main proceedings, the answer to part (a) of the third question is that Article 14(1) of the regulation must be interpreted as meaning that the right to the Community design vests in the designer, unless it has been assigned by way of contract to his successor in title."

All clear enough. It does highlight the need to ensure that outsourced designs are clearly covered by contract - the default rule of UK or Spanish law should not be relied on for Community rights.

New ECJ reference on design copyright

The UK IPO mentions a new reference to the ECJ, link here. Polish readers may prefer this link. The case relates to Articles 17 and 19 of the Design Directive 98/71; the former enshrines the principle of "cumulation" of copyright and design protection, and the latter is the implementation provision.

In implementing Art 17 without explicit transitional provisions, Italy did away with the principle of separability, and reintroduced copyright protection. Some Italian cases have precluded copyright protection for pre-existing works, whereas others have held copyright to exist in even those pre-existing works which have been around for many years.

This reference will, hopefully, enable the ECJ to sort out the Italian dilemma at their usual stately speed. It is, however, pretty outrageous to legislate with such flimsy transitional provisions, and the EU knows full well it is not meant to do this; Art 20 of the Interinstitutional Agreement of 22 December 1998 on common guidelines for the quality of drafting of Community legislation states that "Provisions laying down ... transitional provisions (in particular those relating to the effects of the act on existing situations) ... shall be drawn up in precise terms."

Parliament, the Commission and the Council all signed up to that, so when were they thinking of applying it?

Commissioned Designs and Employee Designs

To jump-start this blog, here is a link to the long-awaited first ECJ words of wisdom on Community Designs, in Case C-32/08 FEIA . Strangely, the issue isn't one of the fundamentals of design protection, but what, to the unobservant, might appear to be a bit of a no-brainer.
Anyway, here are the questions referred by the Alicante court:

1. Must Article 14(3) of [Council Regulation (EC) No 6/2002 of 12 December 2001 on Community designs be interpreted as referring only to Community designs developed in the context of an employment relationship where the designer is bound by a contract governed by employment law whose provisions are such that the designer works under the direction and in the employ of another? or
2. Must the terms ‘employee’ and ‘employer’ in Article 14(3) of Regulation No 6/2002 be interpreted broadly so as to include situations other than employment relationships, such as a relationship where, in accordance with a civil/commercial contract (and therefore one which does not provide that an individual habitually works under the direction and in the employ of another), an individual (designer) undertakes to execute a design for another individual for a settled price and, as a result, it is understood that the design belongs to the person who commissioned it, unless the contract stipulates otherwise?
3. In the event that the answer to the second question is in the negative, on the ground that the production of designs within an employment relationship and the production of designs within a non-employment relationship constitute different factual situations, (a) is it necessary to apply the general rule in Article 14(1) of Regulation No 6/2002 and, consequently, must the designs be construed as belonging to the designer, unless the parties stipulate otherwise in the contract? or (b) must the Community design court rely on national law governing designs in accordance with Article 88(2) of Regulation No 6/2002?
4. In the event that national law is to be relied on, is it possible to apply national law where it places on an equal footing (as Spanish law does) designs produced in the context of an employment relationship (the designs belong to the employer, unless it has been agreed otherwise) and designs produced as a result of a commission (the designs belong to the party who commissioned them, unless it has been agreed otherwise)?
5. In the event that the answer to the fourth question is in the affirmative, would such a solution (the designs belong to the party who commissioned them, unless it has been agreed otherwise) conflict with the negative answer to the second question?

The Regulation is pretty clear that it is referring to employees, and the question of commissioned works was raised, but not settled, during the interminable legislative negotiations. That results in Community Designs being treated differently to UK registered and unregistered designs (and, it seems, Spanish designs too), where ownership vests in the commissioner, but in line with other EU legislation (eg the software directive and the chip topography directive). It is a bit of a trap for the unwary, I suppose, as the UK government intervened to say.

We now have the AGO's Opinion of 26th March 2009 - not, alas, in English so far, but here is a link to the French version.

The answer would appear to be that "employed" does indeed mean "employed". Hurrah. Will the ECJ, as usual, agree? Stay tuned. And if you're looking on the ECJ search page, don't bother selecting "Intellectual Property" - for some reason, this one comes up under "Free Movement of Goods".